We face multiple risks every day as resource managers. We are pretty good at intuitively understanding the likelihoods of different hazards, the uncertainties around them, and their potential impacts on the resources we value, and we use this understanding in our resource management decisions. But the risks we manage are rapidly changing with the climate. Sustainability can no longer presume stationarity. To sustain the benefits of our forests and grasslands, our risk management approach itself must adapt to changing means and extremes. We may have to become even better at the techniques and principles of risk management. Our experience and intuition will only take us so far in a rapidly changing world.

Risk can be defined as exposure to a chance of loss. Losses can be ecological, social, or economic, expressed in absolute terms or in a sense of failure to reach a goal or a desired condition. The link between exposure and loss is vulnerability, shaped by the likelihood and magnitude of hazards (stressors) and by the sensitivity of resources to stressors and its capacity to cope with and recover from stress. Understanding exposures, vulnerabilities, and losses and taking actions to reduce losses within the limits of financial and organizational capacities is the discipline of risk management. Risk management can allow us to capture opportunities as well as reduce or avoid losses. A stressor event – fire, epidemic, flood, landslide – can create opportunities for transition to more resilient conditions, for retreat from high exposure zones, or for learning to avoid similar losses in other places.

Simply said, but not so simply done. Climate change has brought new wrinkles to risk management. Climate does not act alone. It is a mega-stressor that drives other stressors such as fire, pests, and floods, and interacts with many non-climatic stressors such as land use conversion, invasives introduction and spread, energy development, human recreation, and others. It also couples stressors into more complex and formidable forces on the landscape, creates more complicated pathways for exposure, and stretches the extreme conditions beyond our imagination. If we cannot bring these new realities into our management decisions, we will not fare well on our adaptive journey through a changing climate. As climate interacts with topography, other stressors, and demographic and socio-economic changes, we need to regularly reassess the risk profiles and perhaps readjust our strategies.

This is part one of a two-part series from the U.S. Forest Service. Check back tomorrow for part two!

As a farmer, I see risk management tools becoming a close second to crop management tools. Crop/revenue insurance underwriters need to understand the importance of natural capital management as a means to reduce the risk for the insurer. I can manage my soil resources to provide more resilency in long-term crop production, especially in years of marginal drought or excessive moisture, but the liklihood that a majority of crop producers will adopt practices that reduce this marginal risk is directly related to the extent that the crop/revenue insurers value that risk reduction potential of improved natural capital.